Promoting business with Affiliate programmes

[Gineey]

There are 3 main types of affiliate program:

1. pay per sale
2. pay per lead
3. pay per click programs.

Furthermore, programs can be flat fee, or commission-based. They can be single tier, two tier (rewarding those who bring in new affiliates) and multi-tier. Each type of program has its advantages and disadvantages, and each is relevant to different sites and situations.

 

[Artashes]

So what are the advantages and disadvantages of each?

 

[ldcdc]

IMO pay per sale has a major advantage for the advertiser. It's not easy for the affiliates to cheat (especially compared to pay per click) and the company pays only for results. Thus the ROI is (almost) guaranteed.

 

[Artashes]

Absolutely on the same page with you, Dan.

However, pay-per-sale is less attractive to publishers, who generate those $$$ for advertisers. In most cases, if you do not have a massive membership database or have huge specialized traffic to work with, you cannot expect it to work for you well at all. PPC on the other hand can start generating revenue within a short period of time.

Best,

 

[ldcdc]

True, the fence has two sides.

In the hosting business though I've noticed that pay per lead/click affiliate programs have almost dissapeared. Too much fraud I guess..

 

[Artashes]

Actually I think pay-per-lead is not the same as pay-per-click, as "lead" is the same as action, registration or sale. I think you means PPC disappeared, which is not completely true.

Companies just want higher ROI, so they have pay-per-sale systems with their own affiliate one-on-one programs, while they spend their PPC through engines like AdWords or Yahoo! Marketing.

PPC still is hot in the hosting industry. Just check out the last page of WHIR magazine for what some companies pay for top bids.

Best,

 

[ldcdc]

Actually I think pay-per-lead is not the same as pay-per-click, as "lead" is the same as action, registration or sale.

Sure, a lead is certainly different from a click, but IMO a sale cannot (generally) be considered a "lead".

I think you means PPC disappeared, which is not completely true.

My post was strictly referring to hosting affiliate programs. PPC is still playing a serious part in the hosting industry as a whole, that's undisputable.

 

[ayksolutions]

Pay per sale is what I am currently running and I think it works well.

 

[Gineey]

What you people think about .. if a programm has both Pay par Click and pay per sale too.

 

[mrzippy]

We use only pay-per-sale with our affiliate programs. There is no point paying someone for clicks, if the clicks don't turn into sales.

I do think there is a "place" for pay-per-click advertising (adsense, etc), but for us it just doesn't make sense.

That being said, we do offer a rather "higher then normal" pay rate to our affiliates. In other words, it is worth it for them to bring in targetted clicks and try to make the sales happen.

I think that many affiliate programs that pay per sale and have a payout rate of only a few $$ is very funny. There is no incentive. In order to make it worthwhile, you must make it highly attractive for the person to advertise for you. Of course, you also have to have a good product, etc...

For web hosting, I think pay-per-sale is the only way to go.



If you're asking, we pay three times the monthly cost of whatever plan the customer signs up for. So if our plan is $25/month (our lowest plan), then we pay $75 to the person who made the referral. We've calculated this to be one month's cost "lower" then if we had to advertise manually and try to attract new customer. In other words, our per customer cost is about $100 for that account. But we'd MUCH rather pay our existing customers a bit of $$ for their effort, and it helps them to be part of our business, etc.

 

[Sabeur]

soz to go offtopic but which is the best script for these programes.

 

[Rochen]

We have considered launching an affiliate scheme in the past. My major concern though is that one of our affiliates may use 'dubious' tactics to gain customers for us. E.g. sending unsolicited emails etc. regarding our services.

Certainly if we do launch an affiliate scheme in the future then we will run it on a per-sale basis (I think that's the only way it could be done effectively in the hosting market) and closely screen everyone who we allowed to be an affiliate for our services.

- Chris

 

[Castlemelody]

Hi all!

What is the most effective pay per sale affiliate program did you encounter so far?

What we are currently doing is tie up our affiliate program to our payment processor (Clickbank). The advantage is we don't have to write the check for our affiliates because Clickbank does it for us.

I was also looking at shareasale.com, but still evaluating things. If anyone has an experience with them, you may want to share.

Thank you very much.



Add: Just noticed that shareasale requires a minimum charge fee of $25/month. Is it tolerable?

 

[allreseller.com]

hm

can someone be affective in affiliate business without spending alot of capital? I mean affiliates need to make 4-6 months conversion on a sale or they will go elsewhere

 

[mrzippy]

can someone be affective in affiliate business without spending alot of capital? I mean affiliates need to make 4-6 months conversion on a sale or they will go elsewhere

Depends on the business. Our lowest pricing for one of our hosting sites is about $50 for a basic package. We pay over $200 to any affiliate that brings a customer.

Our affiliates love it, and so do we.

But for budget hosting where the company is making $2/month off the customer.. ya.. no affiliate in their right mind is going to actively promote a plan that pays them only $10 or so.